It can be a hassle to buy a short sale home, but you can get the property for a reasonable price. A lot of people clearly understand foreclosure transactions but a short sale is less known for some people. To fully understand the short sale process, here are some tips to help you:
1. Find pre-foreclosures in your area. Use an online database, courthouse listings, and legal ads or hire a professional real estate agent. Determine how mush is owned on the house in relation to its approximate value. If it seems high, it’s a good candidate because it means that the seller might have troubles selling the house for enough to satisfy the loan.
2. View the property to check on the current condition of the house. This will help estimate the cost of repairs or renovation expenses. If it needs work, many “normal” buyers will not buy it, which is good for you.
3. Know all the liens and mortgages by asking the seller or the seller’s agent.
4. Figure out how you’re going to pay for the property. You need money immediately because short sale transactions are fast and may take only a few weeks.
5. Discuss the mortgage situation with a lender.
6. Fill up an application for a short sale request.
7. Assemble a proposal that includes the application form, authorization letter, purchase and sale contract, hardship letter, statement of property’s value, details of cost and liabilities and settlement statement.
8. Negotiate if the lender rejects your offer or come back with a counteroffer.
9. Seal the deal by putting everything in writing and recording it. Make sure that all terms of the deal are understood by both parties.